German companies in Taiwan remain optimistic about the local market despite economic challenges, with a majority voicing confidence they would achieve or outperform their company goals set for this year, according to a German Trade Office Taipei survey released yesterday.
Taiwan continues to be an attractive market primarily for sales and marketing, as well as services, the report showed, after polling 208 German companies in Taiwan between May 14 and June 8.
“Three out of four German companies name local sales potential as the main reason for their engagement here, while two thirds list the proximity to their key accounts as very important,” the survey said.
Almost 25 percent rank Taiwan among the three most important global markets for their global company in terms of sales and profits. About 18 percent of the companies’ Taiwanese offices serve as their headquarters for the Greater China region, the survey showed.
More than 50 percent of the respondents expect to achieve or even outperform their company goals set for this year, while a quarter of the companies expect an improvement in economic conditions, the survey showed.
German companies in Taiwan mainly engage in sales and marketing and services. In sales, machinery is the most important industry for German companies, which continue to see a high sales potential.
At the same time, the industry is facing growing competition from Taiwanese firms, the survey said.
The service industry is dominated by companies from the logistics sector. The German companies that manufacture in Taiwan operate in the fields of automotive, mechanical and plant engineering, and chemicals.
More than a quarter of respondents plan to increase their investment and number of employees this year, but cite recruiting and retaining qualified staff as the biggest challenge to their efforts.
“Recruiting qualified staff is named as a problem, or even a major problem, by more than 50 percent of German companies,” the survey said.
Other challenges are foreign exchange risks and retaining personnel, while increasing commodity, energy and labor costs as well as bureaucracy and administrative hurdles are seen as less problematic.
More than 50 percent of the German companies already benefit from improved cross-strait ties, notably import-tariff reductions under the Economic Cooperation Framework Agreement, the survey said, adding that 51 percent expect to benefit from further reductions and wish for more in the future.
Almost 75 percent of German companies have been active in Taiwan for 10 years, 20 percent hire more than 100 employees and 62 percent reported a turnover of more than NT$100 million (US$3.32 million) last year, the report said.